Warring Factions Unite to Protest Malibu Sewer Proposal

An ad-hoc group of developers, real-estate brokers, environmentalists, politicians and private homeowners from Malibu today will ask Los Angeles County supervisors to postpone their scheduled vote on the proposed $86-million regional sewer system.

The group, whose members for years have battled each other over land-use issues, joined forces this week in an attempt to seek a "reasonable alternative" to the costly sewer system, which they believe outstrips the needs of Malibu and, they claim, has moved ahead without any support from leaders in the coastal community.

"This is a momentous occasion," said Elaine Miller, adminstrative assistant to Sen. Gary Hart (D-Santa Barbara), who helped set up the first meeting of the group Tuesday night. "It's great to see all of these people finally coming together."

The unnamed group will be led by Roy Crummer, chief executive officer of the Reco Land Corp., the largest commercial land developer in the Malibu Civic Center. Crummer came out against the sewer publicly before the meeting, as did the Malibu Board of Realtors and the Malibu Chamber of Commerce.

Crummer has termed the sewer project "an $86-million white elephant" that goes well beyond the needs and scope of the community of 20,000 people that it's designed to serve.

The county wants residents and land owners to pay for the sewer system, estimating that it will cost $13,000 to $28,000 per household, one of the highest prices ever paid for a sewer system by a community in California.

In a related development this week, a UCLA accounting professor disputed the county's cost estimate for the project, claiming that the $86-million figure does not include allowances for cost overruns, interest payments for floating a public bond or "hidden costs" such as managing traffic problems along the Pacific Coast Highway during construction.

Higher Cost Projection

Based on his study of the project, John W. Buckley, Arthur Young Distinguished Professor of Accounting at UCLA's Graduate School of Management, estimated the actual cost of the sewer system at $311 million, which would place an average assessment cost of $131,854 on property owners. That figure includes more than $190 million in interest for the cost of issuing a bond.

But Buckley, who is scheduled to present his 14-page study to supervisors today, concluded that if the cost overruns for large public works projects, which "are usually underestimated by 100 to 120%," are added to the sewer construction estimate, the actual cost would be $590 million, raising the average assessment for each property parcel to nearly $250,000.

"Focusing on the typical single-family residence, I estimate that the proposed project will place a levy of about $99,709 on the typical single-family home, requiring a monthly payment of $397 for the next 24 years," Buckley concluded in the study prepared for the Malibu Township Council, a civic group representing about 1,000 families which for years has opposed a regional sewer project in Malibu.

"In absolute terms, the assessment would be an inordinate burden, equaling or exceeding existing mortgages in many homes," Buckley said in his study.

Tuesday night's hastily called meeting at the Malibu Library featured a cast of characters who have been at odds with each other for more than a decade over growth issues in Malibu.

Among the 22 people in attendance were Crummer; Louis Ragsdale, president of the Malibu Board of Realtors; Peter Arnold, president of the Malibu Chamber of Commerce; Andrew Benton, vice president for adminstration at Pepperdine University; Carolyn Wallace, president of the Malibu Democratic Club and former chair of the Los Angeles County Central Democratic Committee and Leon Cooper, president of the Malibu Township Council.

Peter Ireland, aide to County Supervisor Deane Dana, said that the meeting might prove useful "because it's important that the level of discussion on this issue be elevated so that we are better able to deal with the problems at hand. Sometimes it takes bringing something like this to a head before something can be accomplished."

Although most of the group members favor some kind of sewer system for Malibu, they unanimously agreed that the one proposed by the county was not justified for the size of the community.

Cooper suggested setting up a "waste-water management disposal zone" run by a local board that would allow a mix of septic tanks and package plants to handle sewage in Malibu.

"This is a variable plan that meets the varied interests of Malibu," Cooper said. "It's a much more reasonable plan than the meat-ax approach suggested by the county."

Big Assessment Bills

The three largest landholders in Malibu have been hit with large assessment bills. Crummer was assessed more than $14.5 million for his Civic Center property, Pepperdine University was hit with an $8.8-million bill and the Los Angeles Athletic Club was taxed more than $6 million for it's Malibu property.